Utilization confusion

[skigirl916]

So, I know you're supposed to keep your utilization as low as possible, but is that across all revolving credit lines, or on individual credit lines?

For example, say you have 3 credit cards at $1000 each with a total combined limit of $3000.

Does (A) carrying a $333 balance on each of the three cards have the same result as (B) maxing out one card at $999?

Both (A) and (B) would be 33% utilization of total credit available, but (B) would be totally maxed out.

I'm asking just as a "just in case" - for "just in case" I have to use a card a lot any particular month.

Thanks!

[zeusta20]

IMO...Its a little bit of both. You total CL is definitely important. You want to try and stay below 10% when it comes to your overall UTL. But having ANY card thats maxed out, even if its below 10% overall, is still bad. For example, you DON'T want to have 1 credit card at 9k and 1 credit card at 1k and max out that 1 CC. That still affects you negatively.

..again, from MY experience. And the feedback i've received on this forum.

[annielorie]

yes and no For fico scoring  yes in that your utilization is a percentage of your usage on all cards however Fico takes into account when you have a cards with balances.

Even if you pay in full every month you will still show a balance. You must pay off the bill before the next statement cuts which is usally a few days after a payment is due.  I wouldnt want to max anycard for the reason you could get a FR and it could have adverse effects.  Pay a couple of times a month  if you must use your card that much to prevent this from happening.

[myjourney]

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@skigirl916 wrote:

So, I know you're supposed to keep your utilization as low as possible, but is that across all revolving credit lines, or on individual credit lines?

For example, say you have 3 credit cards at $1000 each with a total combined limit of $3000.

Does (A) carrying a $333 balance on each of the three cards have the same result as (B) maxing out one card at $999?

Both (A) and (B) would be 33% utilization of total credit available, but (B) would be totally maxed out.

I'm asking just as a "just in case" - for "just in case" I have to use a card a lot any particular month.

Thanks!

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OK you lost me sleepy but here Lol

3 cards $1000 each total limits $3000

total UTL for all 3 should not exceed 30%

10% 300

20% 600 

30% 900

Doesn't matter if its on 3 cards or 1

But its never ever good to max any cards out negative effect on scores

[Elcid89]

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@skigirl916 wrote:

So, I know you're supposed to keep your utilization as low as possible, but is that across all revolving credit lines, or on individual credit lines?

For example, say you have 3 credit cards at $1000 each with a total combined limit of $3000.

Does (A) carrying a $333 balance on each of the three cards have the same result as (B) maxing out one card at $999?

Both (A) and (B) would be 33% utilization of total credit available, but (B) would be totally maxed out.

I'm asking just as a "just in case" - for "just in case" I have to use a card a lot any particular month.

Thanks!

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It is both. To maximize credit scoring, your overall utilization (i.e. total credit card debt / total credit card credit available) should remains below 10%, ideally below 7%.

You should also avoid allowing any one card to go over 10%. The formula gets really agressive about dinging you when any one card goes over 50%. In your scenario, you will get dinged under both options, but option B will ding you more.

Note that this refers to reported balances. If you charge up a storm, and then pay it off before the balance is reported to the bureaus, it won't affect your score. FICO only takes into account the balances which are reported to it.